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tv   Street Signs  CNBC  March 8, 2012 2:00pm-3:00pm EST

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released. he'll be playing for a new team. and analysts upgraded nike because he says a lot of people are going to buy not only the existing peyton manning colts jerseys, but whatever new team he goes to. >> nike got the whole nfl contract. >> they have the franchise. >> that will do it for "power lunch." >> "street signs" begins right now. it is your big fat greek deadline just one hour for the bond swap to drop. we've got the latest plus a live report from athens. we put the street heat on housing. robert shiller making bold comments right here yesterday. are we really at the so-called end game for housing? your guest has something to say about that. it's a beer fight. moulson coors all tapped out yesterday, that the merger was a dud. we have an analyst who disagrees. and, hey, now, sirius satellite radio up 50% from october lows. but will competitors like pandora bring it back down to
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earth? a battle. >> indeed it is, brian. checking on the markets the dow is surging ahead of the greek debt deadline. only intel, exxon mobil and mickey ds moving. trading at levels not seen since back in 2007 and over on the nas, starbucks a real big winner trading at an all-time high. must be a big caffeine high. here's our stat of the day. eight retailers hitting new 52-week highs today. everything from target to coach to dollar tree to hot topic, you name it, they're hitting their highs. speaking of hot topics, bob pisani is at the new york stock exchange. bob, as brian said a moment ago, it's less than an hour to go until the big fat greek deadline. let's hope it has a happy ending. if it doesn't, what's going to happen to the market? >> i think a hard default where the psi literally just falls apart, that is not priced into the market. the psi is with or without the collective action clauses getting triggered.
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so, look, remember the whole theme here basically is we get through the greek psi, the deal gets done and tomorrow you get 200,000 plus on non-farm payrolls, u.s. economy is in tact or at least improving. that's why you get one down day on tuesday and two big updays in the last couple days. s&p right near old highs. i think 1374 was the old high. that was on march 1st. we're ten points from that. >> indeed it's been a nice two-day rally. let's see how much longer it can last. thanks for that, bob pisani. >> tomorrow is payroll day. the expectations are up as is our economy. but can this hopium hold out? rbc just releasing its latest read on the health of the american consumer. and the man behind the survey with us now onset. we'll get to him in just a moment. he'll have to set tight -- that was bad. >> that was bad. >> steve liesman here to give us the set tight. >> yeah. rbc index, brian, up about
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47.5%. it's below the long-term average. a question i'll ask tom in a second is it just temporary bounce that will reverse because of high gas price sns take a look march versus february up 7.5. and all the major components expect for expectations which by the way had a huge jump in the last month, some cooling off there perhaps to be expected. the investment outlook and jobs outlook all better while the inflation outlook doing worse up at 78.3. here's a look at the long-term trend. you can see we've come back quite a ways there. there's the bump. and it's up around -- you can see where it was back in '08. and that's a level we want to get to more average level. the highest before the recession. recent experience with job loss at the lowest level since 2007. rbc also saying concern about job loss at a nine-month low. i want to show you this one chart i like from this index here. this is people who have experienced job loss themselves. you or your family. do you know somebody? you can see that is trending down now right around 34. brian. >> all right. so now let's bring in tom.
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>> that's your job. you're the anchor. you toss to me. i toss back to you. you bring tom in and we have a round about. >> we play ping-pong. >> mandy cuts it off and we're done. >> it's verbal ping-pong. >> tv is that simple, folks. those at home. >> it's kind of like cooking. all right, tom -- >> who are you doing in the middle of all that? >> i'm used to being in the middle of all that. >> she's the coach, ref, teacher. >> there's a huge big crash talking of which, move along. >> can we do the show? let's get to the show. how was the report overall? steve says little more positive. looked pretty good. everyone wants to spend their tax refunds. >> they do. but what's interesting on that point, if you look at where people want to spend their tax refunts refunds, people are looking to spend on food and grocery. disproportiona disproportionate amount of people doig that. and also spending oj mortgages or rent. amazing. easily goes to the idea of
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frugality. >> talking of groceries, we know, we all go to the grocery store, we know how inflation is creeping into our lives. certainly something that showed up in your survey as well. at what point do those inflationary expectations and the burning of pricing pressures start to cut into and bring back the consumer confidence? >> what was actually pretty interesting is that in the top line index, you didn't see impact from gasoline as steve mentioned at the top. but what he also showed there was if you look at the expectations component, the expectations component actually fell. if you look at the underlying detail within that component, actually what you would see is that it was mostly driven by gasoline prices. actually, it will probably start to show in the confidence numbers. in fact, i would say it's already there. it's already present. >> tom, there are two metrics in this index or in this survey that has to do with jobs. the one about do you know somebody or yourself lost a job and the other is how secure do you feel in your job? both are improving. what does that tell us about the job market and the unemployment rate? >> i would say that the decline in the unemployment rate was basically due for technical
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reasons as we've been talking about for the last month now. so what's interesting is our index is actually only catching up to the declines that we've seen because of these technical factors. at the end of the day i would say our index right now is consistent with the current level of the unemployment rate. i wouldn't look for any additional meaningful improvement given the fact we've declined technically so much over the last couple of months, again, for technical reasons. not because the backdrop is fundamentally improving. >> with everything that said what do we expect for tomorrow's payroll number? >> where we stand we're looking for 210 for private payroll growth. and in terms of the unemployment we expect it to bounce back up to 8.5%. >> participation jumps up? more people little more optimistic saying i'm going to try to get a job now? >> it's interesting. i know we have limited time. there's a lot going on in the participation rates. particularly the higher demographic. you know, 55 and older, their participation rates are holding up. yet, if you look at -- >> or growing perhaps? people having to work for longer. >> that's exactly what's going on. so if you look at the
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participation rates for those 20 to 24, they're declining chlgt it's not what you want to see right now. when we talk about the skills mismatch going on in the labor backdrop, that's part of it. >> unless they're going back to school, which is another thing that's a positive. we've seen huge growth in student loans for better or worse. that's been one aspect. there's a great theory out there that a lot of young people were pulled from the job market because of great construction jobs and they may be going back to school. that's a potential long-term positive. i want to make the one point, 34% of americans having experience with job loss, that's still a high number. >> i think it's still stunningly high. when we think about the absorption process, we think it's going to be stunningly slow particularly because of the skills mismatch issue. you're unemployed for a particular period of time, your skills diminish. >> what's the thing that concerns you the most? >> it's funny. we're sort of making a big deal about the idea confidence rose quite nicely this month. but the truth is, you know, we're not far away from the lows
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still. we're not breaking out significantly from the range. >> it's off low base. >> exactly. that's what worries us. >> tom, appreciate it. as always. see you again soon. >> absolutely. >> coming up next, the countdown is on to the latest greek debt deadline. it will be at 3:00 p.m. eastern. we'll have a live report from athens shortly. >> and yesterday i called the moulson coors deal one of the worst mergers of all-time. did my cup run over with that bold call? it certainly did from your fan mail to me. we'll ask a top analyst for a cold one, folks. >> e-mails from your mom don't count as fan mail. americans believe they should be in charge of their own future. how they'll live tomorrow. for more than 116 years, ameriprise financial has worked for their clients' futures. helping millions of americans retire on their terms. when they want. where they want. doing what they want. ameriprise. the strength of a leader in retirement planning. the heart of 10,000 advisors working with you one-to-one.
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all right. we're about 50 minutes away now from the huge greek bond swap deadline. remember, folks, 3:00 p.m. eastern is when athens must secure a deal with its debt holders. it's all part of the saga that is the financial bailout of greece. which is why our michelle caruso-cabrera has basically been living in greece for us the last couple weeks. she joins us now live from athens. michelle, is it looking good as we head toward the deadline? >> reporter: it is looking good in terms of securing the deal. the numbers that have been reported by the wire services suggest that a deal will get done not necessarily high enough to avoid triggering the credit default swaps, but we're not done yet. like you said, the deal expires, the offer expires at 3:00 p.m. eastern time. then, when you look at the timeline of events, they suggest that in fact maybe things are
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going well because we now know that they're going to announce results 1:00 a.m. new york, 8:00 a.m. athens time. and then tomorrow 3:00 p.m. athens time, 8:00 a.m. new york time, there's going to be a conference call with the euro group finance ministers where we presume they will make a decision about whether or not they're going to trigger the credit default swaps. one piece of news out in the last hour, the ministry of finance, the public workers there, their pension fund has refused to go along with the debt deal. they will not tender even though it's the ministry of finance that's actually working on this deal. that's either tragic or ironic, both of which are greek words. >> i don't want to sound cute, but are there any people that you've spoken to, michelle, out there who perhaps secretly or not so secretly hoping that maybe greece just defaults anyway? just gets it over and done with? >> reporter: it brings on a hard default, there are economists who say that while it would be
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exceedingly painful in the short-term that ultimately it would be beneficial in the long-term for the simple reason that greece needs real debt relief. and think about this deal that we're talking about. it reduces their private sector debt by 100 billion and yet it adds on public sector debt by 130 billion euros. >> and, michelle, i don't want to get too wonky but at the same time there's a wild card, and that is the collection active clause built into this deal. tell us about that. >> reporter: so the collective action clause was imposed retro actively in the building you see behind me, the parliament, just a few weeks ago the greek government passed a new law changing all the rules of the bonds that they had issued over the years saying we're now going to give you a cac, a collective action clause, which says if a certain number of bondholders -- and actually very small amount, agree to this deal, you all have to go along with them. it's very common in american
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debt and corporate debt. it wasn't in greek debt. the fact that it was imposed retro actively will probably cause litigation. it's also the thing that when they finally impose the cac, that's what will trigger the credit default swaps that are out there. >> and they only agreed to it, right, because they're using british law on this deal, not greek law, which has got to further anger the greeks. >> reporter: right. i mean, it's a little insulting to their dignity some have argued. so if you have a greek bond right now and you hand it into the government, what you're going to get in exchange is something that's supposed to be worth roughly 15 cents in cash and then new greek debt. but that greek debt will no longer be covered by greek law. it's going to be covered by uk law. so future bondholders will say i now know that the people in the building behind me can't change the rules on me like they did this time around. >> great explainer. thank you very much for that, michelle. to reiterate, it's now 45 minutes away from that deadline.
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okay. stocks to the plus side for the second straight session now are raising still more of the losses that we saw on tuesday. we've got whiplash it feels like from this headline driven market. how long will europe's debt issues effect our markets? joining us now is scott ren, senior equity strategist at wells fargo advisors and our very own rick santelli from the cme. scott, it looks like at least according to the participation rate for this greek bond swap deal, you know, everyone's assuming it's going to go through. everything's going to be fine. what if it's not? i'm not going to scare monger here, but number is that a possibility? and number two, what will happen to the markets? >> well, i think it is a possibility, mandy. but i think it's unlikely. from all the numbers and michelle mentioned the wire services, it looks like 75% to 90% probably at the lower end of that range are going to agree to this. the collective action clauses, the minority, will then be forced. but if it would not happen, certainly we would quickly reverse the gains we've seen over the last couple of days.
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that would just increase volatility. you know, this year very low volatility, obviously. we haven't had much back and forth. something like that would certainly create a lot more volatility, the vix would shoot up. we'd see multiple several hundred point up/down days without a doubt. >> in general is it possible to put aside greece for the moment and consider this noise? or is it too personal to the market at this stage? >> i think this european debt issue we are going to revisit this many, many times in coming years. and, you know, my own personal opinion is that even if we band-aid this greek thing -- greek situation right now, you know, down the road they're going to default or they're going to writeoff 100% of this debt. you know, they're probably going to require more bailouts as is portugal and who knows, maybe spain. these are issues -- this european debt issue is going to rile the markets from time to time i think for many years to come. >> i can't agree more and that's
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exactly why i asked michelle that question about maybe they should just get it over and done with. rick santelli, weigh in on this and how it's effecting the markets from where you see it. >> i think mr. ren has it pretty much right. i don't want to say my numbers are the numbers, but the numbers flying around right now on the internet are that about 80% to 85% are in on the psi. so mr. ren's numbers are right somewhere between 10% and 15% are going to go down without much choice in the matter. but i do think as far as the markets are concerned, it takes a pretty much as it's going to happen whether everybody likes the process or not. and the real issue for the markets down the road is something else michelle said, pensioners aren't going along with the program. if the greek people really want to cleanse themselves of all the red tape and all the expenses that have slowed them down, this is the time for that. they could end up being a model for europe down the road. but it doesn't sound like that's the case.
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and that's the next big set of trades for the markets. but it's just too early for the market to get their arms around it. >> scott, i see here by the end of the year you reckon the s&p will be where we are now in a range of 1325 to 1375. yesterday we had michael saying 40% upside from where we are. why is he wrong and can you still make money even if you end up where we are right now? >> i would love to see 40% upside. i would love to be wrong. we're leaning slightly cyclicly right now. we would be performing okay. nothing like we would if we were leaning harder. i think really for me valuations are low, there's no doubt about that. but people typically pay up if you look at p/es when there's anticipation of accelerated growth. and when i see that around the world or when i look around the world, i'm not seeing accelerated economic growth in the states. we've just seen downward adjustments from china.
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downward adjustments from brazil. i think global growth is slowing. japan's not going to do anything for us. europe, you know, the question there is do they have a minor recession or major recession. so i just don't see people paying up for stocks. >> okay. scott and rick, thank you so much for joining us today. >> thanks, mandy. >> sorry, guys. yesterday on the program i said that the moulson coors deal was maybe one of the worst mergers of all time. maybe that was a little extreme. i admit that. that said, for a while it looked great. the stock was near 60 now back to low 40s. not far off the deal price. let's speak with somebody who follows the beverage industry and knows it better than i. mark, would you define this deal as a win or a fail? >> the moulson coors deal i think is a win. >> why? >> cost savings. when they announced that transaction, they didn't have nearly the level of cost savings they have subsequently achieved. and subsequent to that they announced another transaction where they combined their u.s.
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business with sab miller's u.s. business. if we're talking about the combination of moulson and coors, i think that was a good deal. >> but the stock is barely above where it was when the deal is done, their global market share what are they sixth in the world around 3% of the global beer market. i mean, where was the boom that was supposed to occur from this? >> well, to your point, brian, if you look at how the stock performed immediately after the deal, i think there was a lot more value creation then than there's been in the recent two years or so, three years or so. so your point's taken. i think what's happened in the more recent period is that we've seen some pretty stiff challenges for their business in the u.s. and canada. and some other i think some uncertainties about their policy for capital deployment which have been issues for the stock more recently. >> indeed, mark, the last year alone it's down 4%, the stock price that is. so what's going to create shareholder value from here? >> well, thank you for the question, mandy. we have a hold on molson coors. i think it's essential they look
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at the capital deployment policy in a more constructive manner than they have. they've taken steps in the right direction. they've announced some share repo about nine months ago. we think that kind of decision making is good. but there's other things they could do and in fact continue on the direction they're going with the share repo and really think about how you're positioned in these big developmented markets. there are people out there who will talk about and we're among them about, you know, do you really want to perhaps get larger in the u.s.? maybe sab miller sells their stake to you. that would be appealing to folks. >> you sort of read my mind where i'm looking at a scenario looking at market share and about half the global market for beer, is molson coors a pure buyout target? could somebody try to buy the entire company? >> put it this way, brian, if we could wave a wand and say they are not the owners in molson coors that there are in fact namely some families with a lot of voting influence, i think it's an excellent takeout candidate. i think the voting dynamics make
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that a little tougher. >> who would take them out? >> well, one obvious candidate is who i just mentioned from the u.s. perspective, they could actually sell their business to a heineken, for example. they could sell to some other parties as well. but that's one obvious candidate. >> got it. and you have a buy with target of $75. mark, thank you so much. >> thanks, mandy. thanks, brian. >> herb, welcome to the show. >> i'm glad to be here, finally. >> what are you looking at today? >> finally? put the claws back in. >> you talk about the deals and bad deals -- >> that was hyperbolistic about that. >> what's important is you're looking at sales numbers. that's why you have to still go back and really try to dig through to see what acquisitions were made, what deals were done and really understand the financial statements. but it got me thinking what were really the worst deals -- >> first off before you do i have to jump in on that. i fundamentally disagree. i referenced the sales numbers
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but the stock price only thing that matters for investors, report card of a ceo, report card of anything you do with a publicly traded company. >> by the way, the stock price is what i mentioned yesterday as being flat, not what you mentioned being flat. you were talking about the sales. now, let's get onto happier things here. i want to point out -- >> the worst merger ever, number one. >> because i know you love twitter. i went to my twitter followers, i asked them and they all came back. it's kind of interesting you look through the ones so obvious, aol, bank of america, boston scientific, hewlett packard and anything they acquired in the past ten years or so. my favorite in this list, and the list goes on and on, worldcom, diamler chrysler. people forget mattel and learning company. i followed learning company forever. classic case of smart selling selling to the dumb buyer. in this case it was really great because once the deal is done, mattel is almost brought down by the learning company. what's great about the learning company is it was run by kevin,
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who is one of the stars of the shark tank on abc opposite mark cuban. he was the guy who ran this whole thing. and i tell you, mattel didn't pay attention when they did that deal. that actually was one of the worst deals of all-time. >> fair enough. but let's have a caveat. i think we can agree those were some of the worst deals for the buyers and their investors. some of those deals on your list were very good for the sellers, investors. so it depends on what side of the transaction you are on. >> absolutely. >> who sells who a bag of whatever and the seller is often the smarter guy in the deal. >> i polled my twitter followers as well and they said number one aol time warner. >> everybody says that one. >> and the dell deal going to be a disaster. putting it out there. >> you're putding it out there, brian. >> up next, a ceo who's actually creating jobs on wall street right now. head hon cho of liquid net in the wings. >> and a theme we've been
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talking about on "street signs," train, don't complain. our philip lebeau taking a look at the manufacturing economy and finding out if the skills gap is keeping jobs groult down. stay with us. ttd#: 1-800-345-2550 let's talk about how some companies like to get between ttd#: 1-800-345-2550 you and your money. ttd#: 1-800-345-2550 at charles schwab, we believe your money should be available ttd#: 1-800-345-2550 to you whenever and wherever you want. ttd#: 1-800-345-2550 which is why we rebate every atm fee worldwide. ttd#: 1-800-345-2550 and why our mobile app lets you transfer funds, ttd#: 1-800-345-2550 execute trades, even deposit checks just by ttd#: 1-800-345-2550 taking a picture, right from your phone. ttd#: 1-800-345-2550 so talk to chuck and put those barriers behind you. ttd#: 1-800-345-2550 [ kareem ] i was fascinated by balsa wood airplanes since i was a kid. [ mike ] i always wondered how did an airplane get in the air. at ge aviation, we build jet engines. we lift people up off the ground to 35 thousand feet. these engines are built by hand with very precise assembly techniques. [ mike ] it's gonna fly people around the world.
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check out shares of coach up another 5% or so today. the stock just keeps on climbing. up nearly 30% over the last year and more than 100% over the last two years. the ceo, lew frankfort will be on later today. we can only bring back jobs if we, a, have manufacturers expanding, and, b, have manufacturing workers who are ready, willing and able to take those jobs. our philip lebeau with the jobs in america look at manufacturing. do we have one? do we have both? do we have either, phil? >> you've got the expansion in manufacturing, brian. we don't have the skilled workers to fill those jobs. they make water jet steel cutting metal cutting machines. they're working on something here. while they're doing that i want to look at a survey deloitte did
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recently with ceos of manufacturing companies. 74% of the ceos said they have a shortage of skilled laborers. and here's the problem, they think the image of factory jobs or working blue collar in this country has been hurt. and that's because people look at it and say, well, they're dingy dirty places, i don't want to work there. the manufacturers are now working with trade schools and colleges to change that image. in fact, one manufacturer, sgs tools, has a unique recruiting video. >> sgs tool company. turning into a program. what's this? >> i think it's a chance for me to do the type of things i really like to do. i'm good with my hands and i love figuring stuff out. >> this looks like a machine job. do you really want to spend the rest of your life standing behind a dirty machine? >> it's so not like that. it's a big global corporation -- >> the fact of the matter is
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machine shops are no longer dirty and dark. much more complex machinery that people need to operate. more computer knowledge is required. and manufacturers are seeking younger employees to help replace an ageing work force. still ceos are a little frustrated by the lack of skilled laborers out there. >> i could go to 50 states in this country and get the same story from manufacturers. in fact, we do because we talk to many, many companies. and, yes, it is frustrating because i think there's an opportunity and a disconnect that's occurring right now in our economy. >> we're back live. i want to show you something we are working on. over the last couple of minutes the machine here took a piece of metal and, can you see here what they did? it's becoming clear now. just for you, sully, look what they made for you. >> oh. >> little "street signs" cutout right there. >> lovely. >> did that in about ten minutes. so that's a take, just a sampling, of what we're seeing
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when we look at manufacturing jobs here in the u.s. right now. >> two things. number one, that is fantastic. please thank the workers there. that is very, very cool and obviously they are very skilled. back to the matter at hand quickly before i let you go, phil, how many job openings in total -- that is beautiful. how many job openings are we talking about here? >> 264,000. and that has changed dramatically over the last two years. in fact, it's more than doubled. and the problem is they just don't have the skilled applicants. here they have maybe 200 to 250 applications filed over a two or three week period. they might interview ten. and of those ten they are unlikely to hire anybody unless they have the skill set. and that's the problem in this country. >> super quick question, phil, how long will this manufacturing boom last? >> at least through the rest of this year they expect it to last and possibly well into next year. they have not seen a boom like this in manufacturing in the u.s. in at least 25, 30 years. >> let's hope it continues. philip lebeau, thank you so much for that. and please, do, thank the fine folk who is made that "street signs" sign. and still to come onstreet
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signs," noted housing guru robert shiller on our show yesterday and sounded a bit of housing hopium, would you call it, on the show. lots of folks reacting to that. you'll hear one who says the professor is flat out wrong. >> and the home of howard stern, the mad dog. is now the time to finally pay some serious attention to sirius satellite radio? shares up more than 25% this year. it's a baba booey brawl on "street signs" when we come back.
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welcome back to "street signs." let's get you up to date on the latest headlines in today's street talk. it's the final countdown for greece. bondholders have less than 30 minutes to go to agree to a swap deal on greek debt. greece is looking for a 90% participation rate. right now they have more than 70%. the u.s. markets are holding in the green ahead of that deadline. in the meantime, what are the bright spots today? well, tech. tech stocks are actually doing very well. seeing best two-day run in more than a month now. and sirius showing some serious returns so far this year. the stock is up more than 25%
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since january. so where does it go from here? let's ask steve weiss from short hills capital. steve, why are you not a buyer of this stock? >> well, i think right now what you're seeing reflecting in the stock is a lot of speculation that liberty's going to increase their stake, potentially take over the company. i can't buy a stock solely based upon that speculation because others believe that they're going to sell their entire stake and a pretty large stake i believe around 40%. for me, i've got too many other options. i can take my ipod and plug it into my car, i don't have to pay for sirius. i actually have had sirius on four different cars. and $20 each. now you can go down to $15. $20 each, that's $80 a month. i thought that was a little much. i've got cable cost, can't miss cnbc. but i think consumer has to make some choices. with all the alternatives out there aside from sirius. >> i've got to disagree with you just from a customer perspect e perspective. i'm a music freak.
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i pay for pandora, spotify, i still have sirius because of, a, obviously, cnbc. but also football, nascar races. the content that doesn't exist on the other platforms. that's why they brought in howard stern. >> right. >> is that working? the original -- the four or five channels you can't get anywhere else. >> that's true. i'm always going to have it because cnbc because i like -- >> say it again. >> cnbc. because i like cnbc and i listen to it. but i just think that we're different. number one, we're in a different income bracket. i know you're in a much higher income bracket than i am. >> here we go. >> i just think people are going to make choices. >> what do you want to hear tonight? >> i want to know what is the uptake. i just got a new car and i have sirius in there compliment ri for a number of months. they do that with all the oems now. how many subscribers are continuing to subscribe after the free trial runs off this year and next year -- versus the last two years. >> would you also ask him about
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the shares outstanding? i know jim has a lot of questions for him tonight, but this is a company look at the share price, okay, 230, but they have 3.75 billion shares outstanding. >> it's a 10 billion market cap. >> that's my point. looks like a mighty mite. but they have to reduce some of the shares outstandsing, don't you think? one to five reverse stock split. >> right. >> just get back in the headlines mutual fund managers. >> we saw what citi did and still haven't gotten there. it just doesn't happen. >> real quick you mentioned competitor to pandora which yesterday lost about a fifth of its market value. >> right. >> it's faced with a lot of rising costs. okay. so it's revenue is growing and also seeing its usage grow, but the rising costs are just too much. is this an issue also for sirius? do you prefer pandora? >> it's definitely an issue. i can't tell you made money on howard stern, for example. to me, music delivery has become a complete commodity. >> right. >> everybody signed up to
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itunes, plug your ipod in, if you just listen to music, which is what i think most people do, so i don't think the future is bright for sirius. fully reflective positive fundamentals sfwl thank you so much for joining us today, steve. >> pleasure. >> you are not going to want to miss "mad money" tonight. jim cramer will interview the sirius xm ceo. that will be at 6:00 p.m. eastern right here on cnbc. >> well, stock volumes on the new york stock exchange continue to drop, but your next guest says things look pretty good to him. liquid net seeing increased volume as well as bullish sentiment among investors. seth merin is with us. named by the way innovator of the decade among many other honors. honor to have seth on the program as well. seth, welcome back. >> good to be here. >> are you seeing with this run that we've had the last couple of months or last two years really, are you seeing renewed interest in the stock market? >> the good news is that, you know, we're an institutional brokerage firm, a global firm. and we see institutional
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sentiment across the globe. so the institutions around the world are in a good mood. they're very bullish. they remain bullish. and to us that sentiment is a leading indicator, which means that there's more to go in this rally that we're seeing around the world. >> seth, how much is the big money, the institutional money, smart money, call it what you like, how much is leaving places like europe where there are a lot of known problems and even asia pacific and coming back home to the u.s.? >> well, as you know after the great financial crisis, there's a whole new world order. most of the assets have been invested historically in our own backyards. that's not necessarily where the best returns are going to be found. so the institutional investors have the opportunity to look at a global perspective. and when you do it and look at a global perspective, somewhere around the world there's always excellent opportunities to invest in. so, yes, there are shifting money opportunistically into the faster growing economy isn't taking advantage of the arbitrage that they can find
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they like telecom might be cheaper to buy telecom in poland with a better upside. >> you know, seth, i want to talk about jobs if i can. the reason i mentioned that innovator of the decade is because you've built liquidnet up. you have a lot of employees. wall street has been cutting payrolls, taking a lot of heat. you guys continue to grow. can wall street be a job creator again? new york needs it. >> well, wall street is always cyclical. and wall street is famous for overhiring in the good times and overfiring in the bad times. we try not to do that. and we try to invest and continue to invest in the downturns for when the cycle comes back in our favor. so, yes, we've been hiring and we've been growing and we've been adding new businesses on to the platform. unfortunately, well, a lot of our competitors because of their costs are so high tend to take costs out radically during the bad times. >> seth, it's been a common chor us on an almost daily basis, volume low, traders saying
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there's almost no volume but i see here according to your notes your volumes are up this quarter. >> this is a very good market for us. any time there's conviction in the market, any time there's money coming into the market, then the institutions have to buy large amounts of shares, a million shares, two million shares, to fill their orders. that's what we specialize in. we have an average execution size 250 times than found in any other venue. an institutional marketplace. >> seth, fantastic to have you on. thanks, we'll see you soon. take care. >> pleasure. >> salesforce.com has been seeing booming profits in sales quarter after quarter. but can this innovation giant sustain its momentum? that is the question. >> can a relatively young tech company summon this attribute at will indefinitely? that's a question salesforce investors might be asking as the company moves beyond its cloud sales automation product into
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social and mobile services. >> everything we do is about leading the customer into sort of the next technology wave, which in our case is all about social computing and social enterprise. >> for bruce richardson, the key is to ride that wave without getting crushed by it. >> i think it's a great challenge to have to work for a company growing as fast as salesforce has. >> missed steps can be costly and raise red flags for even the biggest believers. last week salesforce suspended plans to build a campus after already spending $270 million on the land. >> the price of pursuing innovation has dropped dramatically in the years i've been in high-tech. going forward keeping everyone focused to pursue the opportunities directly in front of us. >> up next today's big bite, mcdonald's stock, herb is doing a victory lap and loving it. ready to say i told you so. >> "street signs" back in two minutes. don't go away.
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r told me i have an irregular heartbeat, and that it put me at 5-times greater risk of a stroke. i was worried. i worried about my wife, and my family. bill has the most common type of atrial fibrillation, or afib. it's not caused by a heart valve problem. he was taking warfarin, but i've put him on pradaxa instead. in a clinical trial, pradaxa 150 mgs reduced stroke risk 35% more than warfarin without the need for regular blood tests. i sure was glad to hear that. pradaxa can cause serious, sometimes fatal, bleeding. don't take pradaxa if you have abnormal bleeding, and seek immediate medical care for unexpected signs of bleeding, like unusual bruising. pradaxa may increase your bleeding risk if you're 75 or older, have a bleeding condition like stomach ulcers, or take aspirin, nsaids, or bloodthinners, or if you have kidney problems, especially if you take certain medicines. tell your doctor about all medicines you take, any planned medical or dental procedures, and don't stop taking pradaxa without your doctor's approval, as stopping may increase your stroke risk.
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what ? customers didn't like it. so why do banks do it ? hello ? hello ?! if your bank doesn't let you talk to a real person 24/7, you need an ally. hello ? ally bank. no nonsense. just people sense. about 14 minutes now to the deadline on greece. there is your euro/dollar trade. not a huge move in currencies.
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the greek bond swap deadline 3:00 p.m. eastern time. about 14 minutes away. big deal. getting reports we're going to cover it. but until they cover it, they haven't covered it. you know what i mean? greece is rumor central. >> disaster du jour time. herb, not such a golden day in the market for the golden arches of mcdonald's. >> normally i would not wantd to talk about something this obvious in the marketplace, but i'm mentioning it because back on january 24th i pointed out smart investors were scaling out of it. what happened last quarter this is a reason the stock is going to start falling. cramer put crazy stuff on twitter saying i've called the 43 of the last -- i don't know. anyway, just to point out this is actually an important change people are paying attention to. the stock has been down a little bit since we talked about it then. >> i'm surprised to see that its biggest revenue region was europe. i thought we were the burger eetders. >> that's where the growth had
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been and you're seeing the slowdown. about a quarter or two ago they had extended hours in europe. and that, you know, that helped only so far. >> yeah. okay. coming up next, encouraging news about a pill to treat certain types of cancer hoping shares of some companies and hurting others. >> and did we hit a bottom in housing? we debate the new normal scenario that robert shiller outlined on yesterday's "street signs." that's coming up. >> big moves i
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stocks on news about a prostate cancer pill. hey, seema. >> that's right. johnson & johnson delivered encouraging news for prostate cancer treatments. the pill delays progression of the cancer in patients not treated with chemotherapy. a company has a pill that targets the same hormone as j & j's pill. this is not great news for an old company which uses a different approach for treating prostate cancer. down better than 7%. who will dominate the $4 billion prostate cancer market.
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investors are betting on strong trial data. does the j & j add a close second. they may need to cut prices to compete with their rival. down 30% year-to-date. >> seema mody, good news there. on the cancer pill market. provenge has been a fighting drug for years. "street signs" rewind. robert shiller received a lot of buzz. here's what he had to say about home prices. >> in terms of housing, we might be at the end game. home prices are back to a normal level. they could just stay here. and that would be all right. right? housing is very affordable. interest rates are down, prices are down to kind of a normal level. they haven't overshot normal. maybe in terms of housing, this is it. this is it. >> so does our next guest agree, this is it? let's ask him. james camp, you had a chance to
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listen to professor shiller. sort of called the end game for housing, do you agree with him? >> i think we're in a bottoming process but i don't think the end game is upon us yet. the reason i say that, brian, is we still see three or four years in the visible housing space. we hf not really created a financing vehicle for residential housing post-2008. we've sort of let the general agencies limp along at the federal level. we obviously know that the financial system i think it is still strained, balance sheets are still under some pressure. despite the record low interest rates at both the federal funds rate and at the ten-year treasury, demand for credit and in fact supply of credit is still fundamentally broken to us. >> so how many years before the end game is upon us then, james? >> well, if we look at what we see, mandy, today, we see about 14 million yields for sale.
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just the math of it gives us over three years. what i suspect is going to start happening, if we look at the foreclosures in the pipeline that still exist in what we call the shadow inventory, once we get to the bottoming process, you'll see an awful lot of supply come online. that's our main concern. we're already starting to see fannie and freddie do bulk sales where they're packaging large numbers of properties to the hedge fund community. but for people to own a home to live in. >> i'm going to shoot equities at you. because if you look at the share prices of a lot of home builders or housing related stocks in the october lows, some of them are up 50%. there's all this hospital mism about the housing market having bottomed. >> you saw housing starts at the margin jump up. that got everybody excited. fundamentally we don't think they support a robust housing
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market going forward. you see the sea change in psychology. is the house an asset or albatross. people are not able to move and relocate and being constrained by what for our working lifetime has been seen as a real store of value and investment. so i tend to be somewhat bearish on that. and i also have to say that housing isn't going to lead us out of this. we're not going to have a massive housing boom to take us out of this low growth environment. that game has come and gone. we need to look at the economy in a more broad sense. until we really have, as i mentioned, a functioning financing system for real property, i don't see anything other than a bump around the bottom or perhaps even a continued fall in prices. >> well, james, listen to this. because earlier today on "squawk box" a guest had a novel idea of helping housing along with fannie and freddie. listen. >> fannie mae should just keep the foreclosed assets, fix them
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up and rent them and become a big residential reit that owns homes. that will immediately stabilize the housing market. >> what do you think about that? >> i frankly would like the government out of the private markets. >> but they're in it. just drop everything? you've got to do something with their inventory. >> in 2013 they're going to come out of receivership or conservatorship. we'll have a giant amount of inventory on market. if we believe the public sector is better at renovating, managing and functioning as a reit, then so be it. i happen to believe that the private markets eventually, when the prices get to a level, we'll find that asset, rent rolls are actually increasing, and let's let capital, unrestricted, lower regulation, let's let it find the asset class in prices and get the government out of the housing market. >> james, thank you so much for joining us. we're minutes away from the debt deadline in greece.
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it's literally 3 1/2 minutes. we're back in two minutes' time back here on "street signs."
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we're sitting here at 1367, moving up by over 1%. this is about 20 seconds away from the greek debt swap deadline. the nasdaq, we'll bring up that board for you, has -- let me see -- a gain of 1.2%.

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